Biggest drop since March: Aus shares close 1.4% lower

The Australian share market lost 1.4 per cent today, erasing four months of gains. The last time the ASX dropped at least this much was in March.

The outset we had negative Wall Street leads as the 500 US stocks lost 1 per cent on Friday as the 10-year US yield popped to a fresh seven-year high, fuelling interest rate hike concerns. And then in our afternoon session, China’s stock market fell almost 3 per cent after its central bank cut the reserve ratio for lenders. And today its services sector rose more than expected.

At the closing bell the S&P/ASX 200 index closed 85 points lower, or 1.4 per cent lower, to finish at 6100.

Futures market

Dow futures are flat.S&P 500 futures are eyeing a rise of 1 pointThe Nasdaq futures are flat.And the ASX200 futures are eyeing a 92 point fall tomorrow.

Most traded stocks

The top three stocks by value were BHP Billiton Limited (ASX:BHP), Australia and New Zealand Banking Group (ASX:ANZ) and Commonwealth Bank of Australia (ASX:CBA).

Company news

Beach Energy Limited (ASX:BPT) released its presentation that it will be taking on its Asian roadshow in Hong Kong and Singapore this week. It reiterated its reduced guidance levels for production, capex, EBITDA, reflecting the Otway sale and its shares saw some selling. But if you looked at its chart from 2016 it has been on a tear. Shares in Beach Energy closed 5.9 per cent lower at $1.99.

MYOB Group Limited (ASX:MYO) shares hit a year high today, but it slipped from that high ending 19 per cent up (back to where it was on 16 January 2018) after New York-based private equity business, KKR made an unsolicited $2.2 billion takeover offer for MYOB Group Limited (ASX:MYO) at a price of $3.70. That’s a 24 per cent premium to MYOB’s close price on Friday (5 October 2018). KKR also purchased 17.6 per cent of the company from Bain Capital, at $3.15 per share, taking its stake in MYO to about 20 per cent.

UBS advised amid the Coles demerger by Wesfarmers (ASX:WES) it’s marked Wesfarmers a neutral stock with a 12-month price target of $48.50. UBS says its ‘incrementally negative on Coles’ outlook post the de-merger, due to weaker cash-flows’ in the nearer term. Wesfarmers (ASX:WES) shares are 0.91 per cent lower at $49.12 at noon.

The A2 Milk Company Limited (ASX:A2M) was upgraded to a neutral by Citi with a price target of $10.40 (12-months) as the international bank says it’s more positive about a2’s inventory position.

Best and worst performers of the day

The sector with the fewest losses was REITs, shedding 0.2 per cent, while the worst performing sector was Materials, shedding 2.4 per cent.

The best performing stock in the S&P/ASX 200 was MYOB Group (ASX:MYO), rising 19.13 per cent to close at $3.55. Shares in Lynas Corporation (ASX:LYC) and Super Retail Group (ASX:SUL) followed higher.

The worst performing stock in the S&P/ASX 200 was Alumina (ASX:AWC), dropping 6.9 per cent to close at $2.84 (on the back of profit taking and the aluminium prices losing steam). Shares in Beach Energy (ASX:BPT) and Bluescope Steel (ASX:BSL) followed lower.

Asian markets

Lower: Japan’s Nikkei has lost 0.8 per cent, Hong Kong’s Hang Seng has lost 0.7 per cent and the Shanghai Composite has lost 2.8 per cent.

Commodities and the dollar

Gold is trading at US$1,197 an ounce.The iron ore price is flat at US$69.24.Iron ore futures are 0.2 per cent higher.Light crude is US$0.01 higher at US$74.34 a barrel.One Australian dollar is buying 70.62 US cents.

Cryptocurrencies

Bitcoin has fallen 0.03 per cent to US$6,594, Ethereum has gained 0.1 per cent to US$226 and XRP has gained 2.1 per cent to US$0.49, in the last 24 hours.

Finance News Network
Jessica joined FNN in January 2017 after having worked in financial advising for seven years and in TV journalism for seven years, specialising in finance, equities and analysis. She has interviewed former Prime Ministers of Australia, Tony Abbott, Julia Gillard and Kevin Rudd and ex Treasurer Jo Hockey. Jessica has worked as a journalist with Sky News Business, ABC 1, ABC's The Business, ABC24 and has also been a regional Channel 7 and 9 TV reporter.